What is the Average Credit Score in the UK?

Your credit score is your financial footprint that shows lenders how you handle your finances. It's a crucial factor that lenders consider when you apply for loans, mortgages, or any form of credit 💳

As credit scores can significantly impact the terms of credit offered, it's important to understand how your score measures up against the national average.

With the average score as a benchmark, you can strategically work to maintain or improve your score to unlock better opportunities.

If you’re wondering what the average credit score in the UK is, we’ve put together this useful guide to help. From what a credit score is to what makes a good or bad score, read on to discover everything you need to know.😀

What’s the UK average credit score?

The average credit score in the UK is a figure that shifts over time and varies between different credit agencies. Experian, for example, claims an average score of 797 out of 999.

You’ll notice the average score varies significantly between regions of the country, too. In the city of London, the average credit score is 893, while in Kingston Upon Hull, it’s 702.

These average scores are a useful marker for where you want your own score to be. Research the average credit rating in your area to get a more accurate idea of what to aim for.

However, be aware that while these scores are correct at the time of writing, they may change over time.

What is a credit score and why does it matter?

A credit score is a number that shows lenders how you've managed loans, credit cards, and other financial obligations.

Credit scores range from 0-999 and represent a poor, fair, good, very good, or excellent rating. Your score matters because it affects your ability to borrow money or get products like phone contracts or credit cards.

A higher credit score opens the door to better rates and offers, while a lower score can limit your options.

In some cases, lenders will only consider applications from those with a very good or excellent score. Others may specialise in supplying finance to those with a poor rating, but at a higher cost.

In terms of car finance, a good rating can help you secure a low APR, while a bad rating will see you paying a lot more in interest.

You can see how your credit score impacts how much you’ll need to pay by using a budget calculator.

What is a good credit score?

A good credit score will vary between credit reference agencies. At the time of writing, a good score is classed as:

  • Experian: 881-960
  • Equifax: 531-670
  • TransUnion: 604-627

A good score shows lenders you're likely to repay your debts on time. This not only makes it easier to obtain financial products but also helps you receive more competitive rates.

What is a bad credit score?

A bad credit score suggests to lenders that there's a higher risk you might not repay your debt on time. Like a good score, it varies between the different credit reference agencies.

A bad score would be anything between “poor” and “very poor”. Here’s a rundown of what each credit reference agency considers to be a bad score in the UK:

  • Experian: Between 0-720
  • Equifax: Between 0-438
  • TransUnion: Between 0-565

A score in this lower range can make it harder to get approved for loans. It can also result in higher interest rates or less favourable terms.

Tips to Improve Your Credit Score

Improving your credit score is a smart way to boost your financial options in the future. Here are some tips to help lift your score out of the 'bad' range and push it towards 'good':

Check Your Credit Report for Errors

Regularly checking your credit report is important to ensure there are no errors dragging your score down. If you find inaccuracies, dispute them with the credit agency.

Register on the Electoral Roll

Being on the electoral roll improves your credit score by confirming your identity and address. Lenders use this information to check you are who you say you are.

Pay Bills on Time

Late payments can harm your credit score. Setting up direct debits and ensuring you pay bills on time can build a history of reliable repayment.

Keep Credit Utilisation Low

Try to use less than 30% of your available credit limit. Low credit utilisation can be seen as evidence of good financial management.

Limit Credit Applications

Too many credit applications in a short time can indicate financial troubles. Always space out your applications and only apply for what you really need.

Applying for Car Finance with Carmoola

Here at Carmoola, we consider all credit scores. However, we do recommend you check your eligibility before you apply.

We carry out a soft search of your credit report to confirm eligibility, which won’t harm your rating.

Our application process couldn’t be simpler, and everything is done online through our dedicated app.😍👍

Read more about credit scores:


FAQs About Average Credit Score in the UK:

Does checking your credit score lower it?

No, checking your own credit score is considered a soft inquiry and does not lower it.

How can improving my credit score benefit me?

Improving your credit score can lead to better interest rates on loans, higher chances of credit approval, and more favourable credit terms.

How Can Recent Financial Decisions Affect My UK Credit Score?

Recent financial decisions, such as taking on new debt or missing payments, can affect your UK credit score.

Is There a Difference Between Credit Scores and Credit Reports in the UK?

Yes, in the UK, a credit score is a numerical value that indicates your reliability as a borrower, while a credit report is a detailed account of your credit history.